Sustainability

Sustainability

Sustainability Report 2017 ─ Executive Summary

(Extracted from Sustainability Report 2017)

This year, in compliance with a new reporting requirement from the SGX, HPH Trust issues its first sustainability report. This report is based on one of the most widely adopted global standards for sustainability reporting, the GRI.

The Trust listed on the SGX in 2011 but its business units had already been operating for many years, and had reported their corporate social and responsibility measures through Hutchison Port Holdings Limited ("HPH") since 2000. Sustainability is an important consideration in the way the Trust business unit run their businesses and in the new technologies they adopt. Sustainability has also factored in their approach to embedding business integrity, equal opportunity, environmental awareness, and safe, healthy work practices as cornerstones of corporate culture. These cornerstones have become rooted in the way the business units plan, develop, test and adopt new practices and technologies.

RESPONSIBLE BUSINESS
HPH Trust upholds high standards for business integrity, honesty and transparency in its business dealings. Policies in the areas of anti-bribery and anti-corruption ("ABAC"), whistle-blowing and related incident reporting procedures have been enacted. Refresher training on the code of conduct, especially relating to ABAC, is provided periodically to the management team and selected staff members based on their work scope. Any reported cases are independently investigated.

RESPONSIBLE EMPLOYER
As a responsible employer, HPH Trust is committed to providing a working environment that is free from all forms of discrimination. Staff recruitment and retention is a key focus at HPH Trust. Aside from developing career roadmaps for staff members, HIT and YANTIAN have collaborated with local schools over the years to encourage a better understanding of, and interest in, the ports and logistics industry. These include apprenticeships, trainee programmes and internship programmes. As in previous years, these programmes and the achievements of selected staff members were recognised by local authorities in 2017.

SAFETY AND SECURITY
HPH Trust also invests in technologies that support safer operations while enhancing overall productivity. In 2017, all rubber-tyred gantry cranes ("RTGCs") in Container Terminal 9 North ("CT9 North") at HIT had been converted to remote-control operations. This technology allows operators to operate the cranes from a control centre located in the office building, as compared to working from an operator cabin atop the crane. Not only does this enhance operational safety and provide a more comfortable and flexible working environment, it also allows for more efficient operations and job handover.

HPH Trust seeks to continuously improve its safety and health performance, in the face of evolving regulations and standards, customer expectations and technology. At HPH Trust, efforts to ensure the safety and health of our workforce is more extensive than establishing policies and providing induction safety training for front-line personnel. In 2017, HIT and YANTIAN conducted 93 drills, with scenarios ranging from firefighting and fire evacuation to gas leakage, chemical leakage and handling emergency situations caused by extreme weather. Through these drills, as well as refresher training, case studies and safety booklets, HPH Trust business units aim to incorporate safety awareness and equip workers with emergency handling skills in everyday operations.

In the age of digitalisation, safety in operations also extends to cybersecurity. While hardware and firewalls form the basics, effective data-handling monitoring procedures are also key elements of sound system controls. In 2017, YANTIAN was the first container terminal in mainland China accredited with ISO 27001:2013 Information Security Management certification. HIT first obtained 27001:2005 Information Security Management certification in 2009 and subsequently renewed this certification in 2011, 2014 and 2017. Therefore, the Trust's information systems and practices are aligned with the best industry practices. Neither HIT nor YANTIAN had any recorded breaches of customer privacy, loss of customer data, identified digital attacks or digital security breaches in 2017.

THE ENVIRONMENT
Operational excellence demands the continuous review of operating procedures and the adoption of new technology to improve efficiency while lessening impacts on the environment. In January 2017, all front-line port operations in Kwai Tsing ports under HPH Trust were centralised under a co-management arrangement. Through centralised planning and resource deployment, the HPH Trust Hong Kong terminals can more seamlessly allocate vessels to increase berth availability, reduce inter-terminal transfers and related emissions, and optimise yard usage.

Proactively managing environmental impact and advocating for environmentally responsible practices is an important element of the sustainability strategy of HPH Trust. Through the adoption of new technology and the use of alternative energy, HPH Trust business units strive to reduce their carbon footprint. At HPH Trust, the process of adopting new technology takes time, from installation to multiple testing cycles while minimising interruptions to regular operations. Over the past decade, HIT and YANTIAN invested in the conversion of traditional diesel-powered RTGCs to run on electricity or hybrid energy, which reduced noise and carbon dioxide emissions. In 2017, the Trust achieved a 90% utilisation rate for the electric-powered rubber-tyred gantry cranes ("eRTGCs").

YANTIAN began a trial run of nine tractors powered by liquefied natural gas ("LNG") in 2009, a cleaner fuel than diesel. In 2017, a total of 340 LNG-powered tractors were deployed to support daily operations.

In 2017, YANTIAN took the lead in green shore power technology by installing mobile shore power systems that can service 10 berths. This allows vessels to turn off their diesel engines and connect to the local electric grid while at berth, reducing noise and particle emissions. This project was regarded by the Ministry of Transport of China as one of the leading pilot projects for shore power in the country.

Going Forward

Going forward, the Sustainability Steering Committee ("SSC") of HPH Trust will continue to lead efforts in setting short-term and long-term strategies for HPH Trust business units. This will include refining policies to reflect changes in local regulations, incorporating best industry practices in operations, formulating sustainability approach and action plans, and continually adopting new technologies into its operations. HPH Trust will continue to share more of its efforts and achievements in the area of sustainability in the annual sustainability report.

To view more sustainability initiatives, please access the websites of HIT and Yantian.

The scope of the sustainability report includes the Trust's operations at Hongkong International Terminals ("HIT") (Terminals 4, 6, 7 and 9 North) and Yantian International Container Terminals ("YANTIAN") (Phases I and II; Phase III and Phase III Expansion; and West Port Phases I and II) as these are the Trust's majority-owned terminals and core businesses.